and they save lives. on. this bus broadcasting around the world and covering the world of business and finance and the impact upon all of us i'm bart chilton in washington we are sure glad you are with us and on board first of all i want to thank the boom bust team especially daniel britto nathan elliot and cory rippers for helping out while i took a few days off i'm excited to be back in the saddle again it's going to be an exciting twenty nineteen and we look forward to sharing it with all of you coming up this time we kick off the new year talking to professor emeritus at university of massachusetts amherst richard wolffe looking at global and personal debt not going

to believe some of these numbers plus will bear markets warrender the new year for a more in-depth look will turn to admission of adam mesh trading group and later we'll look at that point the bumpy road with taylor letterman of simpler trading and whether twenty nineteen could be a boom or a bust year all that directly ahead but first we have some headlines let's go. to more signs of a slowdown in china lead our global report today as the chinese manufacturing sector shrinks adding to the list of downward trending indicators for china and the global economy on the first for the first full global trading day of twenty nineteen the latest figures for the key purchasing managers index or p.m.i. showing fall of forty nine point four percent from a flat fifty the chinese p.m.i. has not been above fifty the line between expansion and contraction since july of twenty eight teams and the latest reading is the lowest since. feb of twenty

sixteen when the p.m.i. fell to forty nine the fall in the p.m.i. also defied was lower than most surveys and analysts had forecasted a broader composite p.m.i. that adds the service sector activity to the equation showed a smaller december drop of fifty two point six from fifty two point eight in november the key chinese markets in shanghai shen zen and the hang seng in hong kong all fell on the news. and just days after u.s. president donald trump said things were going well with the u.s. trying to trade negotiations the transpacific trade tussle took another kambal with news reports today u.s. trade representative robert light hisor a reputed a hardliner on china policy is saying the troubled ministration may lead even more tariffs against china and is warning that he will not accept empty promises from the other side of the table the ambassador has designated has been designated as a u.s. lead negotiator in talks aimed at resettling the us china trade negotiations by

march first sectors of the global economy are taking downward dips to ring in the new year one area has managed to make gains and even hit record highs precious metals on wednesday gold hit its highest peak since june fifteenth of last year hovering at around one thousand two hundred eighty five dollars per ounce today this follows a slide in prices at the end of last summer part of the meteoric rise of gold prices has been the recent instability of the markets around the globe which have pressured investors to move to safe havens like gold and other precious metals which is priced in u.s. dollars also tends to rise when they meet with the possibility of inflation the same goes for silver which beat the five month high of fifteen dollars of fifty four cents per ounce reach back on august third of last year with an intraday high today of fifteen dollars and sixty nine cents per ounce.

and i couldn't be more excited to now turn to look at debt we do so with an eye toward the debt of various nations around the world and then we'll take a look at consumer deck to do so we are pleased again honored to have with us professor of economic emeritus at richard wolffe who joins us from our new york studio professor happy new year welcome back at the new year to you and i'm glad to be here so i you know i had we had a guy on professor it was three four months ago he had not been on the show since because i asked about that he said well debt doesn't matter doesn't matter again has been on the show since but why does debt matter and who does who controls the debt or owns the debt does that matter professor. well i could not be more clear that matters enormously because what it means is some people the borrowers have an obligation and they have an obligation to take whatever money

they get however they get it and not spend it on goods and services but shifted over to other people who are the lenders and that affects everything about how an economy works governments who are big borrowers in the world economy typically do so because politicians find it easier for their own development and their own success to borrow money from the people they would otherwise have to tax in other words in the. to take an example from the united states last december we gave an enormous tax cut to corporations and the rich then the government not getting that money anymore from them had during two thousand and eighteen to find the money some other way it borrowed the money that it needed to have to make its expenditures and ironically it borrowed a good bit of the money from the corporations in rich people whose taxes it had

lowered so it ended up with an obligation to pay all those people back plus interest whereas if it had not done so had tax them originally in december the way it should of otherwise it wouldn't have a debt so the notion that it doesn't matter misunderstands the enormous impact that debt has on every country on every corporation and on everything amalie that turns to that experience as part of it's for the natural life i want to get to some graft in a moment but first professor i want to just back up just a little bit so when you say that the u.s. then was it was loaned the money from these companies that got the tax cut that reminds me you know people would also say well and then china holds u.s. debt what you're actually saying in it and make sure that i'm correct on this professor is that somebody else is holding our bonds our treasury notes so when we

say either of these companies like you just said or we say china holds the debt what we what you mean is that they are buying our bonds is that correct. that's right and all the bond is what we used to call an aa you all you a good good set a letters because it means that the united states government let's take the example you gave of china the united states government didn't want couldn't get its way around taxing its own companies its own wealthy people i won't say the mass of people because we already overtaxed them in this country anyway but they won't tax corporations and the rich and what it does instead is not only borrow from them but also borrow from other countries if the other countries are willing to lend it's ironic for americans to understand that the united states is the biggest debtor country in the world and the people's republic of china is the biggest creditor of the united states in the world so that means every year and this is really

important tens of billions of dollars of american taxpayer money paid to the government is used by the united states government not to provide schools or hospitals or roads but simply to pay interest to the people's republic of china which receives this financial benefit every year even as the politicians make statements critical of china we as a nation because of those politicians decisions are funding the people's republic of china well it's a good thing professor that they don't have either the chinese or the corporations latitude to hike our interest rates because we give this or that terrible tweet or say something nasty about them i want to shift to talk about the global business we're a global business finance program so let's look around the world that debt as a share of gross domestic product and the chart we have here shows the percentage

of debt versus g.d.p. since two thousand and seven and it shows japan in the u.s. and the u.k. is so. the leaders with a high debt to g.d.p. ratio in germany has a low debt as a share of g.d.p. what's your take on these numbers professor. well you know the answer is pretty simple when the global capital a system crashed in two thousand and eight many governments particularly for example the united states the united kingdom and japan among others rushed in to try to prevent that crash of the stock markets from becoming another great depression and the way they did that was to pump money into the economy and to drop interest rates that in turn stimulated every potential borrower every politician who borrows money from the government every corporate executive who borrows money for their company they now took advantage of these low interest rates

to borrow like there was no tomorrow because it was cheap to do that and for a while that gave a kind of artificial debt boost to the economy the problem is those chickens are coming home to roost now we now have an economy with problems with an overhang of all of this accumulated debt is the irony the last crisis of capitalism in two thousand and eight was handled by dropping interest rates and pumping up dead we are now going into another one in two thousand and nineteen or twenty when the big question is how much will that overhang of debt make the next downturn as bad or maybe even worse than the one we just barely emerged from a professor we're out of time but i want to have you back i hope you'll come back in the next few days maybe next week and talk about consumer debt we want to get to that but i did want to interrupt you because you are hitting on all these important

points we thank you so much professor richard war professor of economics americas university of massachusetts amherst thank you happy new year again take care. you too. and more than three dozen drug companies are increasing prices on more than two hundred fifty prescription drugs happy new year despite pressure from u.s. president donald trump to keep prices low the drug companies say no one company our p.l.c. was especially progressive in price increases on more than fifty drugs and more than twenty five of those will see an increase of nine point five percent meanwhile following a cabinet meeting which included u.s. health and human services secretary alex as are today president trump defied the reality of the circumstances saying that he expected prices of drugs to decrease this year sometimes it seems up is down and black is white these days perhaps the increased drug prices is one reason why the health care sector is one of the few

areas of the u.s. economy to actually be in the positive territory for last year more on that a little later and time now for a quick break but hang here because when we return we'll bear markets war into the new year for a more in-depth look will turn to add a measure of adam mesh trading who is standing by plus we'll look at bit coin's bumpy road with taylor letterman of simpler trading and whether twenty nineteen could be a boom or a bust for kryptos as we go to break here the numbers at the closing bell a mix of red and green arrows on stocks but not much motion in either direction we back in a flash. what hopes and which do you suppose to. put themselves on the line. they did accept or

reject. so you want to present. it was something i wanted. to do right for us this is what the korean people. i'm interested in that was. so what we've got to do is identify the threats that we have it's crazy to confront a shouldn't let it be an arms race. clearly a dramatic development the only really i'm going to lose is i don't see how that strategy will be successful very critical time time to sit down and tom.

welcome back as the new world rang in the new year on tuesday brazil kicked off twenty nineteen by swearing in their new far right president hardballs. mr bowles narrow was elected in october and took the oath of office on tuesday a brazilian in front of the ideological peers from abroad including prime minister benjamin netanyahu of israel and victor o'brien of hungry as well as u.s. secretary of state like palm pilot mr balsa narrow who was widely seen as

a pro-business leader has sent resilient markets in an upward trend since his election just a few months ago it the eyeball vest is one of the. few global markets to end in positive territory for twenty eight teen is a speak mr balsa narrow said he would quote create a new virtuous cycle to open markets and that he would set his sights on tackling the country's deficit just hours later mr paulson arrow reassign management of the brazilian amazon the lungs of our planet to brazil's agriculture ministry which is dominated by brazil's agricultural. and speaking of brazil the latest scandal surrounding ota brecht the international conglomerate based in brazil that may be best known for engineering can construction has a rupture in peru now peruvian president marvin biscardi has declared an emergency at the top of his country's legal system after public prosecutor pedro shivery removed two officials responsible for pursuing corruption investigations involving

over brecht that developed after the so-called car wash scandal broke in brazil and twenty fifteen present this said he will dismiss mr showery and left the balsa narrow ignore ration early so he could personally present to the peruvian congress a bill that will declare a public emergency over the removals and grant the president powers to keep the investigation ongoing. hertz global holdings has agreed to resolve allegations of accounting errors by paying sixteen million dollars in fines to the u.s. securities and exchange commission the f.c.c. found errors in hertz as tax returns from february of two thousand and twelve through march of two thousand and fourteen hertz has already attempted revisions and one restatement for filings from that period resulting in a net decrease in reported pretext revenue of two hundred thirty five million dollars heard stipulated that the pavement of the fine did not signify admission of wrongdoing but the f.c.c. said the errors resulted from factors within the company including quote an

inconsistent and sometimes inappropriate tone at the top notably hurt c.e.o. left septa in september two thousand and fourteen two months after the. company restated its taxable. and we now move to take a look at markets and boy have they been on a wild ride beginning on a downer day for many global markets following that disappointing data on chinese manufacturing we've told you about earlier here to lend a hand as our friend adam mesh of adam mesh trading group adam welcome back happy new year to you my friend. happy new year and healthy and prosperous as well and everyone else so when we look at this adam of the vast majorities of markets all around the world were down although the u.s. markets did less poorly it reminds me of that line from that movie argo this is the best bad idea we have sir u.s. markets adam are the best of the bad markets out there which sector is sort of a save the day for the u.s. i know of and we just spoke about there before the break the drug companies and maybe the health care sector but why did they do well and which other sectors did

well last year adam. and that's a great line because anything else you look at is too risky so it is the best of the options out there in terms of health care technological advances health health care speed of f.d.a. approval mergers helped a lot you saw cigna buying express scripts and then you saw getting bought by c.v.s. so those were two big mergers and that's always going to prop up an industry and they're also not going to be affected by a trade war so health care was a good place to be and it continues to be a good place to be the utility sector hung on for a positive again but other than that everything got hit and swept under the rug at the end of the year everything got hit hard but all you say utilities but energy overall didn't do too well did they i mean i didn't look at the actual numbers before the break but i mean oil was trading i look at it maybe forty five minutes

ago it was like forty six unchanged. new york so energy sector did not do too well last year they took it on the chin what other sectors are sort of really took a tough time last year at em. as you you're right it was the war. that prices in the seventy's a couple months ago now in the forty's so still getting hit really hard and then the financials which at the beginning of the year you want to believe me if i told you they were going to be one of the worst performing sectors but goldman got hit hard with that scandal and the financials just kept falling into the new year so that was that was another set of that got hit really hard the i can no longer say something that i could say for years and years and on and it was of all the sectors of the economy the financial sector did better than all others i used to say that for you know almost a decade now but i guess it ten years was as long as i could say it so you're right there both the dow and the s. and p.

i think five point two maybe six point five percent down respectively something like that they really are having a tough time going for what do you see as sort of the factors that we should be looking at both in the short term and then on the longer term what sort of data other things coming out of the administration should we be perusing were making decisions about where people want to invest. well that is the good news out there is that all the options. everything right now is negative there's a negative on trade wars is negative there's a government shutdown on the fed so right now there's more news that could help the market than could hurt it so that's a good thing for me as always it's individual stock selection i'm fortunate to be on your show a lot i love it and you know i was very bearish for the last couple months before we saw the final one that's i don't know if it's final but that big down move but stock selection still keep a pal one of my favorites is actually higher than when i talked about it

a couple months ago so there are individual companies that will continue to outperform the market and i just think you have to be much more strict with your criteria you know you can't just look at something and say oh yeah that's good i think you have to really say what's performed what's held up under tough times and that's where i want to put my money yeah you need to are i think i mean you know what on your ear and advisor i'm not but it seems to me there are things that are certainly sensitive to the surroundings companies like caterpillar boeing deer that are really could be impacted by these trade wars those could be or even take about g.m. where you know they're shutting some plants and president trump a hit on mary bear the stock took a tumble she got to be careful on all these things which is why we love having you on these individual stocks adam ashe of adam trading thank you so much for being with us happy new year again my friend take care thanks so much.

and we can't start the year with out talking about kryptos that bit cohen around thirty six eight hundred thirty three thousand eight hundred fifty dollars today as we all know the crypto currencies took a deep dive last year but what does the future hold here to help us tailor lettermen of simpler trade we love simpler trade love tale happy new year taylor thanks for being with us again i fear you thanks for having me so first of all let's talk about this terrible tumble last year and what you foresee going into this year we were starting pretty far down so defends look rosier there's some problems on the horizon taylor i mean i think we're starting off the year on a great foot everything green across the board so off to a good start but still a lot of work to be done in a couple market for us to really get back and see some emergence and growth well

let's talk about that work tailor what are the things that out there that would be determinative i mean when we're dispy king had a measure moment ago we were talking about trade wars and what the president might say we didn't talk about earnings reports etc you know the fed in equities markets but crypto is different you know there are a lot of the external factors aren't the same as they are in the equities what are the sorts of things that investors should be looking to to try to foresee a crystal ball about kryptos and their prices going forward. sure yeah i think i think a lot of that is due to regulations we haven't really had a strong bag bone in the regulations yet across every government really i can't count how many times china has attempted or banned. but so what we're looking at the us is unregulated i suppose is the main thing we need to be paying attention to and those have kind of been on the decline lately as the f.c.c. begins prosecuting and fining

a few of the unregulated i suppose we've seen initial point offerings but those raids a ton of money in twenty seventeen it was an innovative and still is an innovative and borderless way to raise funds for a start up but it sucks in the average investor and the average joe has never experienced investing in anything especially something that there should be a lot more skeptical on our understand before they put their money into it and simply don't going up by buying a lottery ticket and so we witness the growth in twenty seventeen and then now the hangover of twenty that we're still seeing if we've shaken it yet but the twenty thousand has definitely been a hectic of the terrible hangover for crypto yeah and you know we have a lot of regulations to go yet those regulations are important you know i tailor i think that you're right on the money that regulations and you know this comes from a former regulator guys so of course i would say this but i think regulations are sort of key to go and forward because of what you said there's been all these cases out there the f.c.c. my former agency the c.f.d.

see they're all over these crypto folks and they should because a lot of fraud going on and they're raising millions and millions of dollars now it did slow down somewhat last year from the year before so we'll have to see if that continues but just folks need to be careful i'm all into crypto as i think it's going to change the world but boy oh boy do they need to be careful i want to ask you about one thing we did a headline and spoke a little bit ago with christiane how the miners some mining companies krypto mining not coal miners crypto mining was backing off they were laying people off explain what you think will happen with miners with prices so low are we going to see less and less miners out there taylor. there's been a concern over miners xtina market as miners x. to market kind of a big network as a whole but looking at what initially happened we saw the y. about price price dropping from six thousand as it was dropping everyone was really

concerned over with miners were going to continue to where there would be profitable or not but that initial drop would did was take away everyone that was operating a higher cost basis and let the ones that had a lower cost basis basis will more efficient their mining or had cheaper electricity to begin to mine more efficiently. with between when the miners begin to exit we see the difficulty begin to lower a little bit so the effort put forth in mining is reduced therefore it's cheaper and it takes less power consumption of it electricity to mind each between that we see mind because the difficulty is lowered so i think will eventually see sort of an equilibrium i think we've met that now and now we'll start seeing more miners come back online they've already spent money and or sunk costs in their money equipment yeah very interesting we'll have to keep an eye on that of these of these mining farms that they have all over the all over the world taylor letterman cryptocurrency analyst trade and web developer at simpler trading thank you joe great to see you again. they for having me. and that's it for this time thanks for

being onboard with us you can catch boom bust on directv channel three twenty one dish network gentle to eighty or streaming twenty four seven on pluto t.v. that's a free t.v. at channel one thirty two or as always you can hit us up at youtube dot com slash bombast r.t. said next time happy twenty nineteen. hello my name's peter and i've been living in russia now for about seven years and this is a film about just some of the crazy things i've gotten through in the time. when

you're going to get yet. only because it is then there's the what you describe because the guys that got me . i still didn't i just. say you will be in the. last year suppose.

to. what. do you mean i. knew. i was going to do it was my mother. was. so good and some. are you. sure it was a. few more. people but people still. talk to your. god. and.

the death toll from the collapse tower block in the russian city of magnitogorsk rises to thirty three with eight others still missing also. taiwan accuses china of insufficient ring after president xi warns he will use all necessary means to ensure reunification. complaints over a dirty politics and the failure to collect rubbish grow as the u.s. government's partial shutdown enters a twelve day the shutdown was spotted when democrats told every key donald trump campaign pledge to build the wall on the border with mexico. is just ten four am head in the russian.